In This Article:
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New Loan Originations: Up 66% to $170.8 million.
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Loan Book: Decreased by 2% to $757 million, but growth resumed in Q2.
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Revenue: $45 million, a 1% decline from the previous half.
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EBITDA: Positive $0.8 million, a 0.6% improvement over the prior half.
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Portfolio Yield: Increased by 69 basis points to 11.2%.
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Net Interest Margin (NIM): Increased by 42 basis points to 5.75%.
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90-plus Arrears: Improved from 1.58% to 1.5%.
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Net Losses: Reduced to $7.2 million.
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Expected Credit Loss (ECL) Provision: $22.5 million, down from $24.5 million.
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Operating Expenses (OpEx): Increased by 6.3% to $13.9 million.
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Undrawn Funding: $168 million available, with $153 million in warehouses.
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Cash on Balance Sheet: $51.9 million, with $18 million unrestricted.
Release Date: February 25, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Wisr Ltd (ASX:WZR) reported a 66% increase in new loan originations, reaching $170.8 million, indicating strong growth momentum.
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The company achieved EBITDA profitability of $0.8 million, showcasing improved financial performance.
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Wisr Ltd (ASX:WZR) has expanded its portfolio yield and net interest margin (NIM), enhancing revenue potential.
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The business is well-capitalized with significant free cash and undrawn warehouse capacity to support future growth.
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Automation improvements have led to 78% of loan applications being automatically approved, increasing operational efficiency.
Negative Points
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The loan book experienced a slight decrease of 2% to $757 million, reflecting a transitional phase.
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Revenue saw a slight decline of 1% due to lower average loan balances, despite improved yield.
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Operating expenses increased by 6.3% to $13.9 million, reflecting the investment needed to support growth.
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The company has not yet reached its target cost-to-income ratio, which is expected to improve with further scaling.
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Despite positive trends, the company remains exposed to macroeconomic risks such as unemployment and interest rate fluctuations.
Q & A Highlights
Q: How does the recent reduction in interest rates impact Wisr? A: Andrew Goodwin, CEO, explained that the interest rate reduction is beneficial as it indicates inflation is under control, which should positively impact consumer cost of living. The combination of lower rates and strong employment boosts consumer sentiment, leading to increased loan demand. Lower rates are generally favorable for small-cap equities, benefiting Wisr.
Q: What are the key drivers behind the 66% increase in loan origination, and do you expect this momentum to continue? A: Andrew Goodwin, CEO, attributed the growth to Wisr's small market share and recent return to growth. The secured vehicle loan (SVL) market is larger, and Wisr expects to gain more market share in this area. The company employs a multichannel distribution strategy and focuses on improving customer experience through automation, which supports sustainable growth.